News and curiosities

June 18, 2005
Bad idea for George Osborne
The idea of a single "flat" rate of tax, applying to all income above a threshold, is back in fashion on the right, and has even been adopted in parts of eastern Europe. George Osborne, new Tory shadow chancellor, should not be tempted. Consider the effect it would have here. Today there are 30m British taxpayers. If the threshold was set at £10,000, around 13m would have no tax bill. To raise, from the remaining 17m, the same amount of tax as was actually raised in 2004-05, the flat tax rate would need to be 31.5 per cent. Apply this to incomes of varying sizes and you find those earning £0-20,000 and over £60,000 end up better off, while the "hard-working families" on middling incomes lose out.

A green gas-guzzler
The designer Katherine Hamnett was recently given two pages in the Independent to tell the world about her new range of clothes and her own "ethical and environmental" lifestyle. It included the revelation that she has owned her car for 17 years "cos I'm not a boy." But our spies in Highbury tell us that the car she is most often seen getting in and out of is a gas-guzzling Toyota Land Cruiser - as unethical as they come. She owns another car (probably the one she's had for 17 years): an Austin Morris collector's item which has been sadly left to rot outside the nearby house of the editor of Prospect. The editor, being a reasonable man, is happy to offer a deal: "Dear neighbour, sell me the Austin Morris for a knock- down price and I promise no more revelations about your unethical lifestyle." Over to you, Katherine.
Meanwhile, another scourge of the capitalist establishment, Naomi "No Logo" Klein, has been caught ruthlessly maximising income. Philip Gwyn Jones, the champion of No Logo when it was published by HarperCollins, had been hoping that Naomi would stick with him for her new book Free Iraq, especially as he has now set up his own publishing house, Portobello Books, with the help of good-causes heiress Sigrid Rausing. Portobello offered a six-figure sum for the book but Naomi went to Penguin instead for £250,000. Maybe she needs a Land Cruiser.

Adonis in the House of Lords
In the very first issue of Prospect, in October 1995, a Financial Times journalist called Andrew Adonis called on Tony Blair, when elected prime minister, to anoint himself secretary of state for education too. When Blair did become PM, he made Adonis his main education adviser and, in the eyes of the educational establishment, Blair and Adonis ran the show. Now Blair has shown that his new premiership is far from a busted flush by elevating Adonis to the Lords and thence on to a job as junior education minister, despite hostile growls from Gordon Brown and many people in education. Watch out for fireworks as Adonis tries to speed up the city academy revolution, which he believes has the potential to be one of Blair's biggest domestic legacies.
Overlooked in the fuss about Adonis vs the educationalists is his possible role in the next stage of Lords reform. Adonis was once an academic political historian, and his great love is the Lords. In fact, his thesis on the Lords in Victorian Britain, published 12 years ago as a monograph by OUP entitled Making Aristocracy Work, has just sold its 500th copy.

Emma Duncan, the engaging 46-year-old Economist journalist, has become the first woman deputy editor of the venerable and hideously successful magazine—it's just hit sales of 1m, around half in the US. She takes over from the grumpy but brilliant Clive Crook, who is off to work for David Bradley, the American businessman who owns the Atlantic Monthly and National Journal. Crook's appointment might signal Bradley's intention to depart from the Atlantic's old-time liberalism.

What is the story behind the extraordinary interview in the Sun, published on election eve, in which Tony Blair and Cherie bantered about their "five times a night" sexual activity? Was it an innocent soft-focus husband and wife chat that got raunchy by accident, or was there some sort of deal? John Lloyd, who is writing a new book on the media/showbusiness nexus, is inclined to give Blair the benefit of the doubt, a necessary trade-off in a fallen world. Others have been less kind.

Pension off some myths
As the focus turns to pensions (and all the other issues barely mentioned in the election) it is worth reminding people that Gordon Brown's famous £5bn a year "raid" on pension funds—from ending the tax credit on dividends—was part of a big, complex set of reforms including a cut in corporation tax. That cut ought to have led to a higher distribution of profits, partly balancing the £5bn loss. Some companies have also been unfairly maligned for their pension fund "holidays," something more or less ordered by Nigel Lawson.